Tinubu’s Claim: The Truth About FDI

By Keem Abdul

In his quest for a more robust involvement in key sectors of the Nigerian economy by foreign investors from both the public and private sectors, President Bola Ahmed Tinubu has had to engage with stakeholders on his trips to various countries around the world – especially the key economies of Europe, Asia and North America.

He alluded to these efforts while presenting his administrstion’s economic report card during his last Independence Day national broadcast on Tuesday, October 1. Among the things he said during the broadcast was that Nigeria, under his stewardship, had so far attracted foreign direct investments to the tune of $30bn – a clear indication, he added, of the impact his administration’s policies are having on the investment landscape in Nigeria, and of the faith the international investment community has in his government’s policies and the potentials of the Nigerian economy and populace. While acknowledging the economic hardships that have so far defined his 15 months in office, he nevertheless asked Nigerians to be patient. “The economy is undergoing the necessary reforms and retooling to serve us better and more sustainably,” Tinubu had said. ‘If we do not correct the fiscal misalignments that led to the current economic downturn, our country will face an uncertain future and the peril of unimaginable consequences. Thanks to these reforms, our country attracted foreign direct investments worth more than $30 billion in the last year.”

Since October 1, there has been some pushback to the President’s claim from certain quarters, as commentators and analysts, as well as critics of the administration, have tried to put the lie to the $30bn figure on various grounds. Among them is that the President’s claim essentially implied that several foreign investors set up shop in Nigeria and invested more than $30 billion of their money in the Nigerian market – at least based on previous assertions made by key administration officials such as Dr. Doris Uzoka-Anite, the Minister of industry, Trade and Investment (on February 17 this year) and the Minister of Information and National Orientation, Mohammed Idris (on March 5).

Among those leading the pushback is the media outlet, SaharaReporters, which said it had since subjected the presidential claim to a data check. It quoted the official data published by the National Bureau of Statistics (NBS) as showing that in the third quarter of 2023, which marked the beginning of the Tinubu administration, Nigeria only received $59.77 million as FDI, while in the fourth quarter of the year, the FDI stood at $183.97 million. In the first quarter of 2024, $119.18 million was earned. In total, the outlet said, the sum of $362.92 million was received as FDI in the nine-month period between July 2023 and March 2024. These figures combined, said the outlet, were ‘a far cry’ from the $30bn figure in question.

Much of this pushback, however, is disingenuous, at best – or dishonest, at worst. First of all, when the aforementioned Ministers (Idris of Information, and Anite of Industry, Trade and Investment) made their assertions, neither of them claimed the government has ALREADY SECURED the said investments in full or during the past year. In fact, Anite, in particular had added the caveat that it would take between five and eight years to redeem all the commitments so far made. Idris, on his part, had said “Since we assumed office in May 2023, we have ATTRACTED $30 billion in Foreign Direct Investment (FDI) commitments into the real sectors of the economy, including manufacturing, telecoms, healthcare, oil and gas, and others …Those investments have already STARTED coming into the country.”

That was exactly the point Temitope Ajayi, the Senior Special Assistant to the President on Media and Publicity made in a recent press statement, in which he made several clarifications concerning the $30bn figure the President gave during his October 1 broadcast. Not only were these investments genuine, Ajayi said, but they were backed by solid commitments from said investors and even, in some cases, their home governments. In emphasizing the distinction between ATTRACTING and SECURING investments, the presidential aide noted that investment commitments didn’t always translate into immediate cash inflows – at least not in the short term. Many of these investments, he said were still in progress, with machinery and raw materials arriving in Nigeria, and final decisions being made on large-scale projects.

Recall that during the G20 Summit in India last year, President Tinubu did receive a total of $14bn in investment pledges from Indian businesses, including $8billion from Indorama to expand its petrochemical and fertilizer plant in Nigeria, $800m from Bharti Airtel for network expansion, and $3billion from Jindal Steel for steel production. In addition, as if to further strengthen President Tinubu’s claim, Airtel has begun construction on a $500 million data center in Lagos. And in the energy sector, ExxonMobil announced a $10bn investment in Nigeria’s deepwater oil production during its recent meeting with Vice President Kashim Shettima (on the sidelines of the last UN General Assembly in New York), while Total Energies committed to a $550 million investment in gas exploration.

In fact, commitments so far made to Nigeria by key members of the global investment community since the advent of the Tinubu administration are as follows: ExxonMobil: $10bn to investment to expand Nigeria’s deepwater oil production; Indorama: $8 billion investment to expand its petrochemical and fertiliser plant in Nigeria; Bharti Airtel: $800 million for network expansion; Jindal Steel – $3 billion for steel production; Coca-Cola: $1bn to expand its distribution network and product range. Coca-Cola has revived the $1 billion investment plan it paused back in 2021, but is now ready to continue because the government is currently addressing some of the fiscal policy issues that had delayed the project. The Alternative Petroleum & Power Limited (APPL) is developing the Hydrogen Polis project to produce green hydrogen derivatives like green methanol and ammonia in Akwa Ibom State; Maersk: $600m investments in Nigeria’s port infrastructure to increase cargo capacity and improve logistics; Arise Integrated Industrial Platform is focusing its $3.5bn investment on revitalizing Nigeria’s cotton and textile industries, with the support of the African Import and Export (Afrexim) Bank, which includes a $5bn country risk guarantee and funding mechanisms to support various projects, particularly in the manufacturing and energy sectors; Shell: $3 billion, which is mainly directed at expanding LNG production, renewable energy projects, and infrastructure development within Nigeria’s energy sector; and Total Energies / NNPC Project Ubeta: $550m

From the foregoing, one can see that these commitments are real, and that the President is working hard to create an economic and political environment designed to make Nigeria a destination of choice for local and foreign investments. It is in our collective interest that these commitments fully mature. Our economy and people will also benefit when businesses come here, do well – and STAY.

With his clear vision and a series of decisive (though tough) actions, President Tinubu is steering Nigeria away from the disfunctions and imbalances that have held the Nigerian economy back by so many decades, and towards a more prosperous and stable future that ensures that the sacrifices being made by Nigerians today will yield substantial dividends in the years ahead.

The fact that the President chose to highlight the success story (an admittedly modest but significant one) on the FDI front during his Independence Day address should be cause for celebration, rather than needless criticism for the sake of mere criticism.